There have been questions lately in the financial community regarding the recent decrease in the volume of trading on the biggest and most liquid virtual currency exchange in the world – and by major, we mean worldwide. You may be asking yourself, “Why are there fewer transactions on the biggest market worldwide?” And the answer to that question is simple. The volume of trading on the Btc market has decreased due to a few reasons and some of these are explained below.
The first reason is competition. Right now, there are more traders than ever competing for the same market as you. As such, the trading game has gotten more heated between the various big guns – and they are gunning for your attention. Some of them have even resorted to old-fashioned and dirty tricks to win out over the competition. As a result, transaction fees have increased in order to make up for the losses that have been incurred by those that have tried their luck in the market.
But here’s the really interesting part.
Why is this? Well, one reason is because of the evolution that has been going on in the technology field. Virtual currencies like the Btc market have gone from being something experimental just a few years ago to something that is quite mainstream today. All those who were involved in trading during the early days of the evolution of digital currencies will agree that the times that they had been much more difficult and risky than what they are today. As such, the competition that has resulted has not been as strong.
So, why is there no competition? Well, another reason is because there wasn’t any significant market for trading until recently. Now, with the advent of websites like Forex Trading, all of these things have changed. These sites now have hundreds of thousands, if not millions of traders pouring into the market everyday. This has drastically lowered the costs associated with trading, which makes it more feasible for people who want to try out this exciting venture. The profits that can be earned – not to mention the security that comes along with a trading – have just been too good to pass up.
It’s all about supply and demand. When the number of people using the internet increases, so does the number of traders entering the market and subsequently, the number of trading sites that cater to their needs.
At the same time, the number of people wishing to get into trading also increases. What this means is that there is a growing discrepancy between supply and demand. This means that as the number of traders increases, so does the trading volume of the market. But this also means that the potential losses that could be incurred drops significantly.
Why is there a lot of people that are willing to risk their money in this kind of market? This is because they believe that they can get away with it – that there is some kind of an “elite” group of people that control the value of the money and therefore, they are able to profit off of small fluctuations in the market. Although many people do believe this, the truth is that anyone can lose his investment, as the market itself is unpredictable and any investor needs to be prepared for the worst.
There is one thing that everyone who is involved in trading should be aware of.
If you are dealing with the virtual currency, then you need to be able to understand the meaning of “leverage”. You can make huge profits from your trades, but if you go over your daily limits – you can get yourself in serious trouble. This is why the most important factor when looking at why there are holes in bitcoins trading volume is to know how much money someone is willing to risk. It doesn’t really matter whether or not you are trading with real money or with a virtual account – you need to be sure that you are putting your money and not your stomach at risk.
Of course, the biggest reason why there are holes in trading volume is that many traders try to take on large amounts of risk. Whenever you have large amounts of money at stake, it is easy to lose control and to get carried away. People who participate in Forex trading are generally sophisticated people – they usually have a good grasp on the market and they know that they should never put their entire portfolio into any one trade. If you are someone who does not have this type of mentality, then you should probably avoid dealing with the Forex market, period.